New Hyde Park-based Kimco Realty Corp., the largest publicly traded owner of open-air shopping centers in the United States, is returning to its roots.

In the last five years the company has sold $5 billion in properties that were either outside the country or were underperforming in the United States, and has refocused on top-performing U.S. properties.

Kimco has been “exiting Mexico, exiting Canada, exiting secondary and tertiary markets to really refocus the U.S. portfolio on the major metro markets,” said Conor Flynn, 35, Kimco’s CEO since Jan. 1, president since August 2014 and an employee of the company since 2003.

Kimco executives said the impetus for refocusing is the difficult experience their company and other real estate entities had in the last recession.

“We’re in the ultimate cyclical business,” Flynn said. While he said he doesn’t expect a recession any time soon, “we’re taking steps to be ready.”

Long Island is a key market for Kimco, which owns 30 shopping centers here, including Airport Plaza in Farmingdale and Jericho Plaza. The company has 556 employees nationwide, including 203 on the Island.

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Kimco owns 88 million square feet of retail space across the country — the equivalent of roughly 211 Nassau Coliseums. Its shopping centers range from strip centers with service-based tenants, such as coffee shops and dry cleaners, to shopping centers anchored by national clothing or home-goods chains. It does not own or operate enclosed malls.

Kimco is the seventh-largest public company headquartered on Long Island, based on its revenue of $1.7 billion last year. It’s organized as a real estate investment trust. A REIT has a corporate tax structure authorized by Congress in 1960 to give average investors a vehicle for investing in commercial real estate.

REITs are required to pay at least 90 percent of their income to their investors. And if REITs distribute all their income, they don’t pay federal corporate income tax, allowing the REIT to pay more to investors. Shareholders do owe tax on the REIT’s distributions, as they would on distributions from a mutual fund.

Open-air shopping centers

Kimco gets most of the income it pays out from owning 550 open-air shopping centers in 36 states and Puerto Rico, which earn rent from tenants such as big-name retail chains, supermarkets, and mom-and-pop shops. About 72 percent of its centers have a supermarket as a tenant.

There are an estimated 114,000 open-air shopping centers across the country, according to the International Council of Shopping Centers. An estimated 123 million adults visit a shopping center each week in the United States, according to the trade group.

Kimco’s biggest tenant, accounting for 3.3 percent of rental revenue, is TJX Companies, owner of T.J. Maxx, Marshall’s and Home Goods. Home Depot is second, accounting for 2.5 percent of revenue. In 2002, by comparison, Kimco’s biggest tenant was Kmart, which made up over 14 percent of rents, Cohen said.

Kimco was formed in 1958 by Milton Cooper, then a New York City real estate lawyer, and Martin Kimmel, a Bronx-born developer of apartments in Queens and Manhattan.

Cooper, an 87-year-old resident of Old Westbury, stepped down as chief executive in 2009 and remains executive chairman. Kimmel died in 2008.

Initially, Cooper planned only to make a personal investment in a Florida property that was to be the first location in that state for Massachusetts-based discount retailer Zayre. When the company that was hired to build the site dropped out of the project, Cooper turned to Kimmel for help. They formed Kimco, a combination of their names.

“Every mistake that could be made, I made,” Cooper said. He had to buy the land entirely after making his initial investment, and the construction phase ran into trouble, Cooper said. Fortunately, he said, recurring rents boosted by inflation eventually made Kimco’s first project profitable.

From that first Zayre location — the retailer no longer exists, but Kimco still owns the Miami retail location — Kimco built throughout Florida and then expanded into other states.

Shift away from building

The company built its own shopping centers until the 1970s, when it shifted to buying and managing properties. The shift allowed it to minimize the challenges of development, and to offer more competitive rents, Cooper said.

In 1991, when Kimco owned about 100 properties, the company went public to access capital, Cooper said. Financing had become “fickle,” a result of overdevelopment and a downturn in the real estate market, he said.

Kimco’s stock offering encouraged other real estate companies to go public because it showed that REITs could sell shares even during a bad real estate market, said Tony Edwards, executive vice president and general counsel of the National Association of Real Estate Investment Trusts, a D.C.-based industry lobbying group.

“A lot of people thought it couldn’t be done because they were in the middle of a real estate recession,” Edwards said.

Through the 1990s and early 2000s, the company profited from buying the real estate of failing retailers, building properties for other owners, and expanding into international markets, Flynn said.

“Our business model at that point in time was very focused on generating transactional income,” meaning earning money from selling properties, said Flynn, a graduate of Yale (B.A. in economics) and Columbia (master’s degree in real estate development) who started at the company as a leasing agent filling the spaces “no one really wanted to deal with.” Flynn’s father, Michael J. Flynn, retired as Kimco’s president and chief operating officer in 2008.

The transactional model generated one-time gains from selling properties that boosted Kimco’s revenue and share price, but “many times you can’t repeat that, especially in a downturn,” Flynn said.

Real estate ‘volatile’

In the recession of December 2007 to June 2009, Kimco and many other REITs were overextended, and owned properties that didn’t perform well, said Rich Moore, senior REIT analyst for RBC Capital Markets, which has handled public offerings of stock for Kimco.

“Real estate, in general, can be a volatile entity,” said Moore, who has been covering REITs for 20 years. Now, he said, Kimco owns one of the “strongest portfolios” in the sector, but in the years leading up to the downturn, Kimco and many other REITs emphasized the size of their real estate holdings at the expense of their quality.

Shares recovering

At their peak in 2007, shares of Kimco were at $52.39. Shares slid to $42.95 in September before plummeting to $7.01 six months later.

Kimco’s shares on Friday closed at $29.56 on the New York Stock Exchange, down 17 cents, and they are up 24.4 percent in the past 12 months.

“The Great Recession shed a lot of light on a lot of things,” Cohen said. “We said we need to come back to our basics.”

“We had close to 900 properties at our peak,” Cohen said. “Really, coming out of the Great Recession it was very evident to us what we do best; we own, operate and manage our own real estate in the U.S.”

Long Island is “a great market,” said Josh Weinkranz, 42, Kimco president of the Northeast region.

Given Nassau and Suffolk counties’ high population, the region is “under-retailed compared to other markets,” making many retail locations here some of the most profitable for national chains, he said.

The area’s educated workforce, schools, relatively high incomes, limited buildable land and high business costs “make a really good environment for retail real estate,” Weinkranz said.

Kimco’s retail space on Long Island is 98.2 percent occupied, compared with the company’s portfolio-wide average of 95.8 percent occupancy.

Flynn said the company wants to stay focused on being an efficient landlord, and invest in its properties to create more value and generate higher income.

“Redevelopment for us is our calling card going forward,” Flynn said. “We have so many properties that we have all the raw materials to really work on.”

Cooper, who is no longer involved in many of the company’s deals, said the next few years will be about serving as a mentor to the “30-year-olds” now running the company.

“I’m really a coach, and it’s gratifying,” he said. “It’s a great thing.”